On October 4, 2013, Jason Klinowski will join Daniel Shaw – Vice President, Deputy General Counsel at H.J. Heinz Company – to address food recalls and to discuss practical tips and best practices for preventing common pitfalls and minimizing downstream litigation exposure. Please join us at theWit for this two-day conference and connect with food industry leaders from The Hillshire Brands Company, Kellogg, US Foods, Nestle, MOM Brands, Cargill, H.J. Heinz Company, and others.
As reported by Food Safety News on April 11, 2013, the Obama administration is “seeking a significant increase in funding at the U.S. Food and Drug Administration to help the agency implement the monumental Food Safety Modernization Act.” Obama Administration Seeks FDA Funding Increase for FSMA Implementation
Noting that the “administration’s budget is very unlikely to be enacted,” Food Safety News reported that:
The White House proposed $3.8 trillion in spending for fiscal year 2014, including $4.7 billion for FDA, which represents a more than 20 percent increase over its 2012 budget. More than 90 percent of the $821 million boost would come from industry user fees.
For food safety, the administration is proposing a $295 million increase, compared to FY 2012, to “build a strong, reliable food safety system,” but only $43 million of that increase would be regular funding. More than $252 million of it would come from food facility registration and inspection fees and food importer fees, but it’s not clear that Congress will actually mandate those fees for the food industry.
According to the budget breakdown from the White House, legislation will be proposed to allow FDA to collect fees for food facility registration and inspection as well as for food import to implement the requirements of FSMA. The document says $59 million would come out of registration and inspection fees. On the import side, the administration estimates it would collect $166 million to support food safety efforts. The food industry has long argued against user fees.
As the FDA continues to roll out FSMA, the produce industry should make every effort to stay up-to-date on how FSMA will impact the industry from a practical standpoint. To be clear, FSMA will (rightly or wrongly) bring global changes to the produce industry and those changes require funding. No matter what the final budget looks like, the food industry will ultimately bear the bulk of the costs associated with implementing and enforcing FSMA. For that reason alone, the produce industry should take great interest in every word used in every regulation and understand every dollar associated with every regulatory fee charged. I urge you to contact your industry association, your peers, your lawyer, etc…. Voice your concerns about how FSMA affects your business.
On April 11, 2013, United Fresh Produce Association, on behalf of almost 90 separate produce industry groups, formally petitioned the FDA to enlarge the May 16, 2013 deadline for submitting industry comments to the proposed Produce Safety and Preventative Controls Rules under FSMA. United Fresh’s request for more time is “necessitated by the complex and substantial changes proposed for the fresh and fresh-cut produce industry by these proposed rules.” United Fresh’s April 11, 2013 Letter to FDA
United Fresh’s letter further states that the proposed Preventative Controls Rule “represents a substantial overhaul of the Current Good Manufacturing Practices (CGMP) regulations regarding the manufacturing, processing, packing, or holding of human food. The CGMP regulations were last revised nearly thirty years ago.” Based on this and other facts, United Fresh stated that “it would be impossible for any interested party to meaningfully comment on these two proposed rules by the current deadline of May 16, 2013.” And, that the Produce Safety Rule and the Preventative Controls Rule “are actually two of a suite of interlocking regulations that will fundamentally alter the global fresh and fresh-cut produce industry.”
To be clear, United Fresh is calling for no less than a 180 day extension of the comment period AFTER the FDA issues the last of the proposed rules for “the Foreign Supplier Verification Program, Preventative Controls for Animal Feed, and the Accredited Third Party Certification.” The FDA has yet to announce the publication date for these already past due rules.
What does that mean? This is an open-ended request for an enlargement of time that may fail because it is open-ended. In my opinion, United Fresh’s position is well founded and their request is appropriate. However, I would hate to see the FDA deny United Fresh’s request based on a technical foul, which is the absence of a specific comment period closing date. I think the better procedural approach would be to ask the FDA for an enlargement of time from May 16, 2013 to a date certain and separately (but perhaps in the same letter) request that each new proposed rule be given no less than a 180 day comment period right out of the gate.
Please remember that many of FSMA’s proposed rules are already significantly past their legislatively imposed publication date. As a matter of fact, the Center for Food Safety and the Center for Environmental Health filed a civil action in August of 2012 against the FDA and the White House Office of Management and Budget in an effort to compel the federal government to comply with FSMA’s deadlines. Against this backdrop, it may be risky for United Fresh to seek an open-ended enlargement of time on any comment period… no matter how well supported.
On April 2, 2013, the FDA issued a Notice extending the comment period on the Institute of Food Technologists’ findings and recommendations to the FDA for the improvement of tracking and tracing food under FSMA. The new deadline to submit comments on the IFT’s report is July 3, 2013.
To be clear, the Federal Register of March 5, 2013 included a FDA Notice with a 30-day comment period for the industry to submit comments on the findings and recommendations contained in the IFT report and to submit additional information relevant to improving food traceability. The IFT’s report, together with industry comments, will help the FDA as it forms its own recommendations as it works to prepare the agency’s report to Congress, which FSMA requires.
Those of you who follow these issues know that the IFT’s report is well over 300 pages long and is a technical document. I think the FDA’s enlargement of time is appropriate because the industry needs time to review the IFT’s report and to prepare meaningful commentary and other related submissions. Please use this time wisely. As you can tell from recent FDA guidance documents, FSMA applies to everyone and the costs associated with food traceability will also affect everyone. Now is the time to voice any concerns you or your association may have on this topic.
This week the FDA launched an updated its Frequently Asked Question & Answer (“FAQs”) section to include detailed areas on the two recently introduced food safety rules, which addressed preventative controls and produce safety.
The updated FAQ section related to the Produce Safety Rule is a fifteen (15) page document that attempts to answer everything from “What does the proposed produce safety rule establish?” to questions about the FDA’s access to company records. Here is a link to The Produce Safety Rule: Frequently Asked Questions and Answers – Produce Safety Rule
Produce industry stakeholders and related associations should take the time to read and understand the Produce Safety Rule FAQs because it addresses such critical issues as:
As previously noted, the FDA extended the comment period on the Produce Safety Rule until May 16, 2013. Please exercise your right to let the FDA know if you have any specific or industry related concerns about this rule. Once the comment period closes, the FDA will respond to comments and finalize the rule. At that point, the Produce Safety Rule will be binding and enforceable.
As reported by The Packer (and announced by the FDA), “the FDA is reopening the comment period for a draft risk assessment for certain food facilities that include farm packing operations for fresh fruits and vegetables.” See FDA Reopens Comment Period on Food Facilities.
To be clear, comments on the FDA’s “Draft Qualitative Risk Assessment of Risk Activity/Food Combinations for Activities (Outside the Farm Definition) Conducted in a Facility Co-Located on a Farm” are DUE ON MAY 16, 2013.
Here is a link to the Risk Assessment: DRAFT Qualitative Risk Assessment Risk of Activity/Food Combinations for Activities (Outside the Farm Definition) Conducted in a Facility Co-Located on a Farm
For those of you who have not yet read the risk assessment document mentioned above, this document addresses the various activities that occur on farms and other food facilities and categorizes the activities based on risk to human/animal health. Make no mistake, a food facilities’ activities will directly affect its registration classification (high risk or low risk). Specifically, the FDA will subject high risk food facilities (based on activity conducted therein) to more frequent inspections and other increased scrutiny. Low risk food facilities are subject to a more lenient inspection schedule because the activities conducted in low risk facilities present a lower risk to human/animal health.
This rule recognizes that food facilities are often co-located on farms, but the activities conducted at the facility could be very different from the types of activities conducted on the farm itself. As such, this rule provides a way for to classify food facilities based on the realities associated with they types of the activities actually conducted at the facility and without regard to its location or association with a high risk food facility or farming operation. The differences will save the industry money in terms of the cost of legal compliance and that makes this document worthy of comment.
More importantly, the Risk Assessment document provides detailed responses to the following important questions:
Question 1: What are the foods that would be manufactured, processed, packed or held by a farm mixed-type facility?
Question 2: What are the activities that might be conducted by farm mixed-type facilities on those foods?
Question 3: What are the hazards reasonably likely to occur in those foods?
Question 4: For the purpose of determining whether an activity/food combination is low risk, which hazards should be considered to have a reasonable probability of causing serious adverse health consequences or death?
Question 5: For the purpose of determining whether an activity/food combination is low risk, what foods have inherent controls that significantly minimize or prevent a biological hazard that is reasonably likely to occur in these foods and that is reasonably likely to cause serious adverse health consequences or death?
Question 6: What interventions significantly minimize or prevent a hazard that is reasonably likely to occur in these foods and that is reasonably likely to cause serious adverse health consequences or death?
Question 7: Which of these activities are reasonably likely to introduce, or increase the potential for occurrence of, hazards that are reasonably likely to cause serious adverse health consequences or death and what are these hazards?
Question 8: Which of these activities are interventions to significantly minimize or prevent hazards that are reasonably likely to cause serious adverse health consequences or death from consumption of these foods?
Question 9: Which activity/food combinations are low risk?
Please take the time to read this document and exercise your right to comment upon how it affects your business. Now is the time to voice any concerns.
The FDA recently issued a revised industry guidance document titled: What You Need To Know About Administrative Detention of Foods; Small Entity Compliance Guide Utilizing a question and answer format, this industry guidance document contains some valuable information. Here are some of the highlights you need to know:
Why is administrative detention needed?
Administrative detention provides a means through which FDA can hold adulterated or misbranded food and prevent it from reaching the marketplace, thus further enhancing FDA’s ability to ensure the safety of food for U.S. consumers.
What food is subject to administrative detention?
The term food refers to (1) articles used for food or drink for man or other animals, (2) chewing gum, and (3) articles used for components of any such article (section 201(f) of the FD&C Act [21 U.S.C. § 321(f)]). The term food also refers to dietary supplements, which are to be treated as food under the FD&C Act (section 201(ff) [21 U.S.C. § 321(ff)]).
How long may FDA administratively detain an article of food?
FDA may detain an article of food for a reasonable period, not to exceed 20 calendar days, after the detention order is issued. However, an article of food may be detained for 10 additional calendar days if a greater period of time is required to institute a seizure or injunction action. The entire detention period may not exceed 30 calendar days (21 CFR 1.379).
What criteria does FDA use to order an administrative detention?
An officer or qualified employee of FDA may order the administrative detention of any article of food that is found during an inspection, examination, or investigation under the FD&C Act if the officer or qualified employee has reason to believe that the article of food is adulterated or misbranded (21 CFR 1.378).
May an administratively detained article of food be delivered to another entity or transferred to another location?
It is a prohibited act under section 301(bb) of the FD&C Act [21 U.S.C. 331(bb)] to transfer an article of food subject to an administrative detention order and/or to alter or remove any mark or label that identifies an article of food as administratively detained.
Can an administrative detention order be modified?
FDA may approve a request for modification of an administrative detention order to allow for the destruction of the article of food or movement of the detained article of food to a secure facility, to maintain or preserve the integrity or quality of the article of food, or for any other purpose that the authorized FDA representative believes is appropriate in the case (21 CFR 1.381(c)).
What’s the difference between an import detention and administrative detention?
FDA’s authority to administratively detain food under section 304(h) of the FD&C Act [21 U.S.C. 334(h)] is separate and distinct from detention that may occur during FDA’s import admissibility review. Under section 801(a) of the FD&C Act [21 U.S.C. 334(h)], when food is imported or offered for import into the United States, FDA conducts an admissibility review to determined whether to admit the product into United States or detain the product.
On the other hand for administrative detentions under section 304(h) of the FD&C Act, FDA will issue an order to the owner of the suspect food notifying him that FDA is administratively detaining the food and that he has an opportunity to appeal the detention with or without a hearing (see 21 CFR Part 1 Subpart K).
When does an administrative detention order terminate?
If FDA terminates an administrative detention order or the detention period expires, an authorized FDA representative will issue an administrative detention termination notice to any person who received the detention order (or that person’s representative), releasing the article of food, as quickly as possible. If FDA fails to issue an administrative detention termination notice and the detention period expires, the administrative detention is deemed to be terminated (21 CFR 1.384).
Who pays the costs associated with the detention order, such as storage, moving, disposal or reconditioning?
As stated in the preamble to the 2004 final rule (69 Federal Register 31659 at 31690), the party or parties responsible for paying the storage costs of food that FDA orders administratively detained is a matter between the private parties involved with the food. FDA is not liable for those costs. An owner, operator, or agent in charge of the place where the food is located can always request modification of a detention order to destroy the food if they do not want to store it.
Please take the time to read the entire guidance document. It contains information about your rights and other deadlines that become very important if your product is administratively detained.
On Friday, September 21, 2012, Jason Klinowski served as one of five panel speakers at the Turnaround Management Association’s “Trying to Stay Healthy in a Distasteful Economy” Breakfast Forum Event, which was held at The Standard Club. During this event, Jason discussed the Perishable Agricultural Commodities Act and the Food Safety Modernization Act in order to illustrate some of the challenges they present to the food & agribusiness industries.
Tyler Mayoras of O’Keefe & Associates moderated the panel, which consisted of: Wayne Carpenter (Managing Director of Lake Pacific Partners), Ed Cooper (Senior Vice President of Wells Fargo’s Food & Agribusiness Office), Justin Segel (CEO of American Pasteurization Company), Jason Klinowski (Agricultural & Food Law attorney at Freeborn & Peters) and Troy Terwilliger (CFO of Graceland Fruit).
The FDA recently issued a DRAFT guidance for the food industry discussing the agency’s current thinking regarding the necessity of food categories in food facility registrations.
DISCLAIMER: The forthcoming discussion relates to draft guidance that is still open for comment, modification and retraction. As such, it is not intended for immediate implementation in its current form and it does not create a legally enforceable responsibility.
Step One: Relevant Rule (FD&C Act & Bioterrorism Act)
Section 305 of the Bioterrorism Act, generally required domestic and foreign facilities that manufacture, process, pack, or hold food for human or animal consumption in the United States to register with FDA by December 12, 2003 (See 68 FR 58894). This section also required facilities to submit registrations to FDA containing information regarding applicable food product categories as identified in 21 CFR 170.3.
Step Two: Necessity to be Determined by the FDA Through Guidance
Section 415(a)(2) of the FD&C Act, as added by section 305 of the Bioterrorism Act, provided in relevant part that, when determined necessary by FDA “through guidance,” a registrant must submit a registration to FDA containing information necessary to notify FDA of the general food category (as identified in 21 CFR 170.3) of food manufactured, processed, packed, or held at such facility.
Step Three: FDA Issued the Requisite Guidance and Finding of Necessity
On July 17, 2003, FDA issued a guidance stating that the agency had determined that the inclusion of food product categories in food facility registrations was necessary for a quick, accurate, and focused response to an actual or potential bioterrorist incident or other food-related emergency (see 68 FR 42415).
Step Four: Net Result…
Section 305 of the Bioterrorism Act, in relevant part, requires a food facility registrant to submit a registration to FDA containing information necessary to notify FDA of the general food category (as identified in 21 CFR 170.3) of food manufactured, processed, packed, or held at such facility.
What’s New Under FSMA?
Step One: The New Relevant Rule
FSMA, enacted on January 4, 2011, amended section 415 of the FD&C Act. Section 415(a)(2) of the FD&C Act, as amended by section 102 of FSMA, now provides in relevant part that, when determined necessary by FDA “through guidance,” a registrant must submit a registration to FDA containing information necessary to notify FDA of the general food category (as identified in 21 CFR 170.3 or any other food categories, as determined appropriate by FDA, including by guidance) of any food manufactured, processed, packed, or held at such facility.
Step Two: Necessity to be Determined by FDA Through Guidance
FDA believes that it is necessary for a food facility to submit to FDA a registration containing the general food category as identified in 21 CFR 170.3 and any other food categories as identified below, if applicable, for a quick, accurate, and focused response to a food-safety related issue or an actual or potential bioterrorist incident, other food-related emergency, or food safety incident.
FDA believes that information about a facility’s food categories is a key element to allow for rapid communications between FDA and facilities directly impacted by actual or potential bioterrorist attacks, other food-related emergencies, or food safety incidents. Information about the categories of food a facility handles currently assists FDA in conducting investigations and surveillance operations in response to food-related emergencies. These categories also enable FDA to quickly alert facilities potentially affected by such an incident if FDA receives information indicating the type of food affected.
Section 102 of FSMA, also provides in relevant part that FDA may, through guidance, determine that additional food categories, other than those listed in 21 CFR 170.3, are appropriate for the purposes of food facility registration under section 415 of the FD&C Act.
Step Three: FDA Issued a DRAFT Version of the Requisite Guidance and Finding of Necessity
This draft guidance document also addressed the FDA’s finding of necessity needed to include additional food categories into the food facility registration process. To this end, the “FDA believes that the following additional food categories are appropriate for food facility registration and will include such categories as mandatory fields in the food facility registration form when FDA finalizes this guidance”:
Additional Food Categories for Foods for Human Consumption:
- Acidified Food (see 21 CFR 114.3(b));
- Cheese and Cheese Product Categories: Soft, Ripened Cheese; Semi-Soft Cheese; Hard Cheese; Other Cheeses and Cheese Products;
- Dietary Supplement Categories: Proteins, Amino Acids, Fats and Lipid Substances; Animal By-Products and Extracts; Herbals and Botanicals;
- Fisher/Seafood Product Categories: Fin Fish, Whole or Filet; Shellfish; Ready to Eat (RTE) Fishery Products; Processed and Other Fishery Products;
- Fruit and Fruit Products: Fresh Cut Produce; Raw Agricultural Commodities; Other Fruit and Fruit Products;
- Fruit or Vegetable Juice, Pulp or Concentrate Products;
- Low Acid Canned Food (LACF) Products (see 21 CFR 113.3(n));
- Nuts and Edible Seed Product Categories: Nut and Nut Products; Edible Seed and Edible Seed Products;
- Shell Egg and Egg Product Categories: Chicken Egg and Egg Products; Other Egg and Egg Products;
- Vegetable and Vegetable Product Categories: Fresh Cut Products; Raw Agricultural Commodities; Other Vegetable and Vegetable Products; and
- Baby (Infant and Junior) Food Products Including Infant Formula.
Additional Food Categories for Foods for Animal Consumption:
- Grain or Grain Products (i.e., barley, grain sorghums, maize, oat, rice, rye, wheat, other grains or grain products);
- Oilseed or Oilseed Products (i.e., cottonseed, soybeans, other oilseeds or oilseed products);
- Alfalfa Products or Lespedeza Products;
- Amino Acids or Related Products;
- Animal-Derived Products;
- Brewer Products;
- Chemical Preservatives;
- Citrus Products;
- Distillery Products;
- Enzymes;
- Fats or Oils;
- Fermentation Products;
- Marine Products;
- Milk Products;
- Minerals or Mineral Products;
- Miscellaneous or Special Purpose Products;
- Molasses or Molasses Products;
- Non-protein Nitrogen Products;
- Peanut Products;
- Recycled Animal Waste Products;
- Screenings;
- Vitamins or Vitamin Products;
- Yeast Products;
- Mixed Feed (e.g., poultry, livestock, equine);
- Pet Food;
- Pet Treats or Pet Chews;
- Pet Supplements (e.g., vitamins, minerals); and
- If none of the above food categories apply, print the applicable food category or categories (that does not or do not appear above).
Step Four: Net Result… (coming some in final form)
Once FDA issues the final version of the aforementioned guidance document, the foregoing rules about registrations and additional food category disclosures will become a mandatory requirement for food facilities and a legally enforceable obligation under FSMA.
On July 31, 2012, the FDA announced its fee structure for rates to be assessed under the Food Safety Modernization Act in 2013. The rates for 2013 are $221.00 per hour if no foreign travel is required and $289.00 per hour if foreign travel is required. These new rates will be effective from October 1, 2012 through September 30, 2013, which is when the next fiscal year’s fee schedule will be published.
The good news is that the 2013 rates are lower than the 2012 rates, which were $224.00 per hour is no foreign travel is required and $325.00 per hour if foreign travel is required. Perhaps the rate reduction in 2013 is a sign that the FDA is attempting to implement FSMA in light of the known operational realities and pain tolerances for administrative fees that exist in the food industry.
With that said, it is important to remember that FSMA’s fee structure represents hourly rates charged by each FDA inspector participating any type of billable activity related to a given case. As a reminder, billable activities include conducting the reinspection at the facility, making preparations and arrangements for the reinspection, traveling to and from the facility, analyzing records, analyzing samples, preparing reports or examining labels and performing any other activity deemed necessary to determine compliance with the regulation or statute found to be violated in the initial inspection. Other billable activities include conducting recall audit checks, reviewing periodic status reports, analyzing the status reports and the results of the audit checks, conducting inspections, traveling to and from locations, and monitoring product disposition. Simply put, even with a reduced fee structure, FSMA related fees can add up quickly and significantly impact businesses.
Will the FDA charge and collect fees under FSMA in 2013?
Because FDA recognizes that for some small businesses the full cost recovery of FDA reinspection or recall oversight could impose severe economic hardship, FDA intends to consider reducing certain fees for those firms. FDA is currently developing a guidance document to outline the process through which firms may request such a reduction of fees. FDA does not intend to issue invoices for reinspection or recall order fees until this guidance document has been published.
Who will be affected by these fees?
Only those parties in the food and feed industry whose non-compliance results in the following activities:
- Facility reinspections – follow-up inspections conducted by FDA subsequent to a previous facility inspection that identified noncompliance materially related to a food safety requirement of the Federal Food, Drug, and Cosmetic Act (the Act). The reinspection must be conducted specifically to determine that compliance has been achieved.
- Recalls – food recall activities performed by FDA that are associated with a recall order with which a responsible party has not complied.
- Importer reinspections — follow-up inspections of a food offered for import conducted by FDA subsequent to a previous inspection that identified noncompliance materially related to a food safety requirement of the Act. The reinspection must be conducted specifically to determine that compliance has been achieved. As discussed in F.2.2., these fees will not be assessed until the agency has resolved issues associated with these fees and the public has been notified by the agency.
Can small businesses have their fees waived?
The FY 2013 fee schedule does not contain any reduced fee rate for small business. However, FDA does not intend to issue invoices for reinspection or recall order fees until a guidance document to outline the process through which firms may request a reduction of fees has been published. Once published, invoices will be issued and firms can apply for reductions as outlined in the guidance.
How does FDA plan to charge these fees?
For facility reinspection fees, FDA will invoice the responsible party for each domestic facility and the United States Agent for each foreign facility for the direct hours, including travel, spent to perform the reinspection at the appropriate hourly rate. For recall order fees, FDA will invoice the responsible party for each domestic facility or an importer who does not comply with a recall order under sections 423 or 412 of the Act for the hours spent to cover food recall activities associated with such order. For importer reinspection fees, FDA will invoice the importer for the direct hours spent to perform the reinspection including travel. Detailed payment information will be included in the invoice.
Which fiscal year rate will be used and when?
The fiscal year in which the reinspection occurs dictates the fee rate to be applied. For example, if a reinspection was conducted in September, 2012 and the invoice was issued in October, 2012, the fee rate to be applied would be the FY 2012 rate. The invoice clearly itemizes the fiscal year, hours and rate used to calculate the total invoice amount.
How long does the responsible party have to pay the fees?
Payment must be made within 90 days of the invoice date.
What happens if the responsible party or U.S. Agent does not pay?
Any fee that is not paid within 30 days after it is due shall be treated as a claim of the United States government subject to provisions of subchapter II of Chapter 37 of Title 31, United States Code.